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There’s
a truth that no one in the economic
development profession wants to admit, says
Debbie Kurtz, president of 310 Ltd. in
Richmond, Va.: The leads are drying up. Many
companies are outsourcing to Asia, while
others are squeezing more productivity out of
existing U.S. facilities. As a
result, economic developers are chasing fewer
prospects than at any time in Kurtz’s
professional memory. The dearth of deals is
scary, says the economic development marketing
veteran. “We’ve all got a problem.”
Compounding
the profession’s woes, a revolution in
digital communications is creating new
business-to-business marketing options – and
undermining old ones – in ways that keep
even the experts playing constant catch-up.
“People are consuming information in very
different ways today,” Kurtz says. “What
worked then won’t work now – even if the
prospects were out there.”
As a
consequence, the economic development
profession is experiencing more uncertainty
than ever before. Too many practitioners are
coping with the unknown by sticking doggedly
to time-honored strategies and marketing
techniques – even though evidence is
mounting that they don’t work anymore.
Kurtz
sees consultants and advertising agencies
consuming precious resources that could be
used to generate hard leads. “It’s
maddening--there’s no accountability,” she
fumes. “Clients are hurting. They say,
‘Make the pain go away!’” Agencies and
consultants are only too happy to oblige.
But the
relief is fleeting. For instance, consultants
produce enormous reports listing target
industries the client could attract. Then they
walk away, leaving the developer with a lot of
ideas but no action, no prospect list and no
results. Likewise, ad agencies love producing
brochures and print ads. (Agencies love print
ads—they get paid twice for their work, one
for the creative and then a 15 percent
commission for placing the ad.) If graphics
and tag lines could influence a site decision,
then advertising may be worth the high price
tag. But they rarely work.
“Agencies
love the creative, but sometimes they lose
perspective on meaningful messages,” Kurtz
points out. “Many community brochures look
alike with no focus on what distinguishes the
area. They’re selling exactly the same
thing. Images blur together, making it hard
for site selectors to tell one community from
another.”
The
fact is, says Kurtz, companies making site
selection decisions aren’t looking for
pretty pictures. They want numbers. They want
to know how much it’s going to cost to build
a facility, how much will it cost to operate,
and how easily they can find workers with the
skills they need.
Kurtz
doesn’t think much of direct mail either.
“How much direct mail do you
read at the office?” she asks. “Direct
mail never makes it past the receptionists and
assistants, so if you’re on a limited
budget, you should find something else. Why
not just eliminate the mail and pick up the
phone, which you’re going to do anyway?”
Kurtz
favors websites, noting that site-selection
consultants increasingly prefer the anonymity
of the Internet to do their research. But
they’re not looking for photos or animation.
“Your website is the most important tool in
your kit, but people look for content and not
graphics, animation and flash. They’re
looking for numbers, and it’s all driven by
the bottom line—what’s in it for them to
consider your community?”
Adapting
to the Digital Revolution
If you’re trying to generate traditional,
old-fashioned economic development prospects,
what does work? Besides the Web, Kurtz
endorses research and cold calling, and leans
towards digital media as the preferred mode of
communication outreach.
Kurtz
doesn’t profess to have all the answers.
Indeed, keenly aware that the dot.com gurus of
the 1990s never foresaw today’s digital
communication and marketing tools like
electronic newsletters, webinars,
pay-per-click advertising and blogs, she’s
the first to admit that today’s marketing
crazes may prove to be tomorrow’s abandoned
fad. “Frankly, a lot of this is new,” she
says. “We don’t think there are any silver
bullets out there. But we can say this: Our
integrated approach will yield measurable
results that you can manage for better
performance.”
Kurtz’
marketing methodology emphasizes the
following:
Asset
research. Develop an in-depth
knowledge of your economic development assets.
“Having a skilled labor force and an
industrial park and all of those basic
resources is just your ticket to the game,”
Kurtz asserts. “You’re going to stand out
based on what you have beyond that.”
Spend
time determining what makes your region
distinct. You need to tell prospects how well
they align with the skill sets found in your
workforce and the expertise found in related
businesses. Comb the region for unique
resources -- like university R&D programs,
federal labs, think tanks, and cultural assets
– that make your area a stand out among your
competitors. “You need to innately know your
own resources, if only just for marketing
purposes,” Kurtz states, “and you
shouldn’t need to pay someone to tell you
what you already know."
Study
your competition -- analyze the region that
got the deal you lost. Find out what it has that
you don’t. Finally, Kurtz recommends,
document the growth and successes of
businesses that are thriving in your location.
Ask for testimonials—they are powerful
marketing tools that add little to your
marketing budget.
Prospect
research. Once you thoroughly
understand your competitive advantages,
ascertain which industries line up best with
your assets. “You can use a large portion of
your money advertising and mailing at random
and waiting for someone to contact you,”
says Kurtz, “or you can do your homework and
identify the companies who represent your best
prospects based on your assets.”
Work
the phones. There is no
substitute for picking up the phone and
calling people. Even if they’re not
contemplating an expansion right now, or even
if they don’t think you make a good fit, you
will gain valuable intelligence. Says Kurtz:
“Cold calling can be frustrating and time
consuming, but in the end the results are
direct, measurable and statistically have a
greater impact on prospecting than other
marketing approaches.”
Distribute
your storyline. Even the best
research, the most comprehensive database and
the most aggressive calling effort in the
world won’t turn up every conceivable
prospect. By distributing your narrative as
far and wide as possible, you can pique the
interest of someone you might never have
imagined would be a prospect.
If you
can afford it, hire a P.R. firm to pitch your
story to the media. Just remember, that
there’s no assurance of success. A frugal
alternative is to bypass traditional media
through the use of digital marketing
techniques. More and more people are tracking
down information by entering key words into
search engines like Google, Yahoo and MSN,
Kurtz says. The search engines are voracious
consumers of content. To ensure high rankings
in the key-word searches, Kurtz recommends
creating content geared to carefully selected
key words.
Economic
developers need to equip themselves with a
whole new set of marketing tools. To be
effective today, Kurtz says, they need to know
how to optimize their websites for the search
engines. They need to know how to convert
sales materials into storylines that can be
distributed over PR Newswire and BusinessWire,
and picked up by the host of new online
publications. They need to learn how to
integrate their websites with electronic
newsletters, press releases, case studies,
testimonials and pay-per-click marketing
campaigns.
The
Internet is evolving so rapidly that it takes
effort to stay current, Kurtz says. The latest
phenomenon: blogs. These inexpensive
electronic forums provide outlets for members
of the public to address community concerns;
many are maintained by local activists and
disgruntled citizens who don’t share the
priorities of the development sector. Savvier
prospects are bypassing official channels by
frequenting these sites to gain insight into
citizen attitudes. Economic developers need to
stay on top of the opinions expressed in these
venues so they can be prepared to respond.
The
"Economic Gardening" Strategy
For many regions with limited existing industry
and resources, it may be difficult producing
prospect inquiries no matter how sophisticated
the marketing program. For those areas, the
most effective strategy may be “economic
gardening,” or growing new businesses from
the ground up. Stimulating entrepreneurship
requires a very different mix of community
assets than luring outside corporate
investment. Inevitably, any “gardening”
strategy will entail community efforts to
develop, recruit and retain human capital, and
that creates an opportunity for economic
developers to reinvent themselves.
“There’s
no question in my mind,” says Kurtz, “that
the role of the economic developer in the 21st
century will shift from recruiting corporate
capital to recruiting human capital.”
Kurtz
sees the writing on the wall -- the dynamics
of economic development are changing – and
she’s refashioning 310 Ltd. to help her
clients stay abreast of those changes. There
will always be a role for corporate
recruitment, and she’s offering an updated
mix of products and services to help economic
developers pursue their traditional quarry
more cost effectively. Meanwhile, she’s
developing new competencies that will help
clients undertake economic gardening
strategies.
“If
economic developers don’t change their
priorities, they’ll get left in the dust.
They need to be asking really fundamental
questions right now,” Kurtz says. “If you
want to make your website pretty, hire an
advertising agency. If you want help in
rethinking your strategy, talk to us.”
--
April 11, 2005
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